Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Alliance Fiber Optic Products (UNKNOWN:AFOP.DL) have surged nearly 13% today after the company bested the Street's earnings consensus and offered strong guidance for the upcoming quarter.

So what: Alliance's revenue rose 65% year over year to $19 million, narrowly missing the $19.1 million consensus but nevertheless posting marked improvement. Earnings per share came in at $0.49, $0.02 better than the lone estimate. For the in-progress third quarter, Alliance anticipates revenue in the $19.5 million to $20.5 million range, which is better than the flat $19.1 million revenue consensus.

Now what: Analysts weren't expecting much out of Alliance on a sequential basis, so any improvement was bound to get some attention. This also seems to be a strong refutation of the recent B. Riley downgrade to "hold" status, as analyst Dave Kang mentioned last week that he found it difficult to believe that a $19-million-plus revenue level could be sustainable. Alliance's current 27 P/E isn't particularly cheap, but with this kind of growth on the way (even the low-end projection would be a big boost over last year's Q3 revenue of $12.4 million), it's not exactly nose-bleed expensive, either.

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